A More Diverse Economy

The Southern Virginia region is pushing past its legacy of tobacco production and textile manufacturing to recruit a diversified group of companies.

“When the city of Danville was a mill and tobacco-processing town, we had two industries, and those got wiped out, and we got wiped out,” says Linwood Wright, a former Danville mayor who serves as a consultant to the city’s office of economic development. “Today we only have one tobacco processing plant, Japan Tobacco Inc., and it is state-of-the-art.”

Danville scored two huge economic development projects last year with Essel Propack’s expansion and PRA Group Inc.’s decision to establish a call center. The two announcements alone amounted to $46.2 million in capital investment and 545 new jobs.

The city had worked with PRA on the call center deal for some time. The Norfolk-based debt recovery company is investing $15.1 million in the call center and expects to create 500 jobs. Danville competed with several states for the project.

PRA bought an Airside Industrial Park building that had housed a Telvista call center. About 300 people lost their jobs when Telvista closed the call center in March. “PRA will pay their employees close to twice what Telvista was paying their employees,” Wright says.

Essel Propack, an India-based specialty packaging company, plans to spend $31.2 million in expanding its Danville manufacturing operations. The project will allow the company to double production at the Danville facility.

The city competed with Brazil and Argentina for the expansion project, which is expected to create 45 additional jobs. Essel Propack has more than 2,850 employees worldwide, including 252 in Danville, its only U.S. manufacturing operation.

Joint effort Meanwhile Danville is trying to attract more advanced-manufacturing companies. “We are not specific to any one type of product,” Wright says. “We have had several announcements of that kind of business recently. We are also beginning to develop a strategy to attract cybersecurity firms and IT businesses but not necessarily data centers because they are not huge employers.”

The city also continues to look for food-processing businesses because “we have excess water and wastewater treatment capacity which lends itself to food processing,” Wright says.

Danville and Pittsylvania County worked together to recruit BGF Industries Inc., a subsidiary of the France-based Porcher Industries Group. The company is spending $7 million to build a 25,000-square-foot facility in the Cyber Park, a 330-acre technology park in Danville’s enterprise zone. (The park is owned by the Danville-Pittsylvania County Regional Industrial Facility Authority.) The investment is expected to create 65 jobs over three years with an average annual salary of $75,000.

Other major announcements in the Danville-Pittsylvania area include Harlow Fastech, which will be the first U.S. precision sheet metal fabrication plant for United Kingdom-based Harlow Group Ltd. Harlow provides precision engineered, fabricated, machined and 3D printed additive components.

The company is investing $8 million in the project, which is expected to create 49 jobs at an average wage of $55,000. Harlow also will establish in the Cyber Park its U.S. Training Center of Excellence, a facility focused on additive manufacturing.

“The company is hiring now,” says Matt Rowe, Pittsylvania County’s economic development director. “They are planning to break ground in the spring. It will be a very fast-tracked project.”

In another project, Micro Blenders, an additive feed manufacturer, expects to spend $3.5 million to create at least 15 jobs in Gretna. The company bought a long-vacant 90,000-square-foot building in the Pittsylvania town and plans to add 25,000 to 30,000 square feet to the structure.

Also in Gretna, Amthor International, the largest tanker truck manufacturer in North America, is spending $2.5 million to expand its manufacturing operation, creating 90 jobs over five years while retaining 110 existing positions.

“They have already hired 72 of those 90 folks,” says Rowe, noting the project is under construction. “Amthor is still very much a growing company. Hopefully there will be additional news from Amthor in 2019.”

Other expansions involved Eastern Panel Manufacturing, which is adding 15 jobs as part of a $1 million investment, and personalized medicine and nutrition solutions provider Panaceutics, which is making a $5.8 million investment involving 70 new jobs.

Industrial parks “I think [2018] has laid the foundation for what looks to be a promising 2019,” Rowe says.

The county filled so many buildings “to the point that we have no building product left,” he adds. “We were able to continue our mission to diversify the economy in the county.”

Additionally, the Berry Hill megasite park, which has been rebranded as Southern Virginia Mega Site at Berry Hill, is now shovel ready. “We have had numerous site visits on that site,” Rowe says, noting the county has a contract for a 163-acre site that would result in an investment of at least $200 million.

The county also has its new site, the Southern Virginia Multimodal Park in Hurt. The Staunton River Regional Industrial Facility Authority — which includes Pittsylvania, Danville and the towns of Hurt and Altavista — is recruiting companies to the industrial park.

“We have a lot of momentum,” Rowe says. “It’s about keeping the momentum. We are slowly moving up the food chain of project types and sizes. It always takes time to get momentum, but once you get it, things start to come to you, and that is what we are seeing.”

‘Big hurdle for us’ Martinsville and Henry County also saw solid growth throughout 2018. Last year the city and county brought in 548 jobs and more than $79 million in investments.

One of the biggest wins involved Poland-based Press Glass, which is investing $43.55 million in a 280,000-square-foot manufacturing operation in Commonwealth Crossing Business Centre. Press Glass is the first company to locate in the park. The project, which is under construction, is expected to result in 212 jobs (see story on Page 34).

“That was a big hurdle for us to get over after working for 10 years to develop the park,” says Mark Heath, president and CEO of the Martinsville-Henry County Economic Development Corp.

Another big win: Memphis-based Monogram Food Solutions LLC announced it is investing $30 million to expand its manufacturing operation, Monogram Snacks, in Henry County. Virginia competed against six other states for the project, which will create an additional 300 jobs. The project represents Monogram’s fifth expansion since 2009.

“We have solid job and investment numbers,” Heath says. “We are actively recruiting higher-paying companies. We are seeing an upward movement in the average wage. Press Glass and Monogram are over $16 an hour in wage.”

Last year foreign investment and company expansions helped to boost the economy. “We average two-thirds expansions and one-third new companies,” Heath says. “The vast majority of companies we talk to are international.”

Like Monogram in Henry County, Microsoft has expanded employment at its data center in Mecklenburg County many times since 2010. The sixth expansion, announced at the start of this year, will add 100 jobs to the company’s Mecklenburg workforce. The data center currently employs 300 people.

South Boston, meanwhile, is seeing a lot of interest in the market-rate apartments Echelon Resources is developing in the former 135,000-square-foot Tultex Building, now The Imperial Lofts. Thirty-eight of the 42 apartments already are rented. Rents range from $800 to $1,100 a month. “This is a moneymaker for the town,” says Tom Raab, South Boston’s town manager.

Plans for a project to redevelop the former John Randolph Hotel building into a 27-room boutique hotel went out to bid in February. Town officials hope the project will break ground by summer.